The investments of the future are green, and that is why we have an ambition that our investments will be net zero (carbon neutral) by 2050 at the latest. Not only will this future-proof our customers’ pensions savings, but it also supports the Paris Agreement’s target of limiting global warming to 1.5 degrees Celsius.


In order to meet our long-term ambition, we are taking action in the short term, and in March 2021 we introduced interim targets to reduce the carbon intensity of our investment products in five of the most high-emitting sectors. By 2025, we aim to reduce carbon emissions in these sectors by between 15% and 35% in relation to 2019 levels. Today, we are ahead of our targets for the utilities and cement sectors, and there is positive momentum in the automotive and shipping sectors. However, progress in the steel, energy and aviation sectors needs to pick up pace.

“In general, we've got off to a great start, and we can see the positive effect of being in close dialogue with the companies that are delivering on their climate strategies and raising the bar. We still have a big task ahead of us, and we’re reliant on companies adopting new green technologies. The carbon emissions reductions will fluctuate over time, but we’ve established a clear strategy to achieve the targets – a strategy in which active ownership and our ability to influence companies are our primary tools to reduce carbon emissions while we continue to deliver attractive returns to our customers,” explains Søren Lockwood, CEO of Danica Pension. He continues:

“We’ll also assess how we can to an even greater extent target our investments towards the companies that have progressed furthest with their transition, and we’ll increase our investments in the green transition. At the same time, we can choose to divest companies that are failing to make sufficiently fast progress in the area of climate, as we did with Exxon.”


The carbon footprint of our total equity and bond investments has also been reduced, achieving a 17.5% reduction from 2019 levels. In addition, we have almost quadrupled our investments in the green transition from approximately DKK 10 billion in 2019 to DKK 37.7 billion today.


More companies committing to climate initiatives

An encouraging sign is the fact that almost 70 of the 269 companies in the sectors are today committed to the Science Based Targets initiative (SBTi), whereas this number stood at just 20 in 2019. The SBTi ensures that the carbon-reduction transition plans of the companies are in line with the goals of the Paris Agreement, and it is hoped that more companies will commit to the initiative over the coming years.

It’s companies that are able to make the greatest reduction in global carbon emissions, so we’re focusing on the most high-emitting sectors because this will make the biggest difference.

- Søren Lockwood, CEO, Danica Pension

“It’s companies that are able to make the greatest reduction in global carbon emissions, so we’re focusing on the most high-emitting sectors because this will make the biggest difference. For some companies, making the transition is a process that takes a long time, but it’s our experience that these companies listen to our requirements and are working resolutely with climate-related issues. There’s room for improvement, and a more companies need to be setting and delivering on more ambitious climate targets,” says Søren Lockwood, who further explains that certain sectors are facing a difficult future, which underlines the importance of using active ownership to encourage companies not to postpone their transition.


Transition affected by the energy crisis

The war in Ukraine, high inflation, outdated technologies and the energy crisis have put companies under pressure, and the same factors have consequences for companies’ carbon emissions and for the roll-out of green solutions. In particular, we have been in intensive dialogue with energy companies to discuss the balance between mitigating the effects of the energy crisis and increasing the companies’ contribution to the green transition.

“The energy crisis has dealt a serious blow to the economy and has put energy companies in a dilemma. Many of these companies are in the process of replacing carbon-based energy with green energy, but at the same time they are increasing their usage of fossil-based energy in order to maintain stability in society. This can delay the development of renewable energy in the short term, but if they fail to take an environmentally responsible approach over the long term, we can choose to divest these companies,” says Søren Lockwood, continuing:

“The crisis can also kick-start the green transition. The USA has responded to the crisis with a historically large green stimulus package, and the EU is about to present a plan that provides companies with financial incentives to become more climate friendly. Even though there are many unknown factors, we still believe that companies that are helping to drive the transition will become the most attractive investments over the long term.”


Stagnant progress in the steel and aviation sectors

We have also been in intensive dialogue with the steel sector, which is a sector facing substantial challenges. To significantly increase the level of climate-related initiatives, the sector needs new solutions such as green hydrogen, renewable electricity-powered furnaces, and carbon capture and storage facilities. These are technologies that require a substantial financial outlay, and the steel companies do not expect them to be implemented on a large scale for some years. Also, the companies need government support schemes to be able to finance this transition. Because the current focus of the sector is on using existing climate technologies, we expect that in the short term it will face challenges in reducing carbon emissions at pace sufficiently compatible with our target.

The increase in carbon emissions from our investments in the aviation sector is far from satisfactory and can, to a large extent, be attributed to the corona pandemic. However, investments in the aviation sector represent only 0.04% of our total investments.

“Corona has hit the aviation sector hard, with airlines experiencing a drop in passenger numbers and lower turnover. As a consequence, the amount of CO2 emitted by airlines for every kilometre flown increased, and this translates directly into a large increase in carbon intensity. To reverse the trend, airlines need to adjust their fleets so that they better match passenger numbers and are more energy efficient. But to make a really significant cut in emissions, more airlines, aircraft manufacturers and the energy sector need to strengthen their collaboration on developing new green aviation fuels, which hopefully will become a reality within a reasonable time frame,” concludes Søren Lockwood.


  • The sector-specific targets cover equity and bond investments, and the reductions were calculated at the end of June 2022.
  • We measure the carbon intensity of our investments. Calculations are based on how much CO2 a company emits in relation to its turnover and on the size of the individual investment as a proportion of our total investments. For example, if a company is able to increase its turnover without increasing its carbon emissions, the company’s carbon intensity decreases.
  • In 2022, the five sectors account for 35% of carbon emissions from our total investments.
  • The reduction targets for each sector are defined on the basis of different emissions categorisation scopes (indirect and direct emissions). They have been set according to where the sector has the most substantial carbon emission and in relation to the availability of sufficient valid CO2 data. The energy sector is measured across scopes 1, 2 and 3; the utilities sector across scope 1; the transportation sector across scopes 1 and 3; the steel sector across scopes 1 and 2; and the cement sector across scope 1.
  • The carbon emissions reduction of 17.5% for all equity and bond investments has been measured across scopes 1 and 2 and from a 2019 baseline.
  • Since 2019, we have almost quadrupled our investments in the green transition from approximately DKK 10 billion to DKK 37 billion today. Our target is that 15% of our expected assets in 2030 will be placed in this type of investments, which will equate to DKK 100 billion. Read more.